>> this is nbr. captioning sponsored by wpbt >> tom: i'm tom hudson. retail and auto sales hold steady, but that's not adding much clarity for the holiday shopping season to come. >> susie: i'm susie gharib. four years after the credit crunch and j.p. morgan is hit with a fraud lawsuit over behavior in its bear stearn's unit. the man behind the lawsuit, new york attorney general eric schneiderman, joins us. >> tom: and why some american manufacturers think an economic slowdown could be on the way. >> susie: that and more tonight on nbr! it's only october, but at stores around the country, it's beginning to look a lot like christmas. the national retail federation is predicting a 4.1% gain in holiday sales. that would not be as good as last year, but still above the ten-year average. but as erika miller explains, there's greater uncertainty than

usual in the forecasts. >> reporter: past the halloween decorations, the candy, and costumes, you will find the artificial trees, wreaths, and tinsel. stores like this kmart are displaying christmas merchandise early, hoping for a greater share of holiday spending. >> they are coming in and looking at the trees and getting the thought in their mind that christmas is coming, and start to think, "what can i start shopping for now?" >> reporter: but forecasters say it's more difficult than usual to predict consumer spending this holiday season. the big wild card is the presidential election. >> this is the most difficult year we've ever had to predict our forecast, because there's never been this level of uncertainty in terms of tax and spending policy really in our history. >> reporter: his organization, the national retail federation, is forecasting a 4.1% gain. but the international council of shopping centers is more cautious, predicting an increase of less than 3%. shoppertrak and deloitte fall in the middle. some of the differences can be

blamed on conflicting economic signs. higher home prices and stock prices are boosting consumer confidence. >> people are always looking for something to give them a real sort of positive outlook, something to make them feel better. shopping is pretty much one thing to make most people feel better if they can. >> reporter: but job growth is weak, and food and gasoline prices are rising. with so much uncertainty, you can expect to see lots of holiday promotions. but tv ads will come later. >> in normal years, we'd already start to see some holiday advertising taking place now. but because of the political elections that are coming up and the campaigns, there's virtually no airtime that retailers can afford to buy. >> reporter: but you can bet those commercials are coming, as retailers fight for sales. some stores make nearly half their annual revenues in the final two months of the year. erika miller, nbr, new york. >> tom: shoppers were out buying

passenger cars last month, but a drop in pickup truck sales hit g.m. and ford. ruben ramirez reports buyers of smaller cars are fueling sales gains. >> reporter: car shoppers took a little breather in september after this summer's shopping spree. general motors says sales grew just 1.5%. ford was essentially flat from the same period last year. ford's f-series pickup, which it calls the best-selling vehicle in america, inched up just 1%. but while sales of trucks slowed, compact passenger cars moved briskly. one beneficiary was chrysler and its fiat brand. it had the best september in five years. toyota also saw solid growth as it continued to recover from last year's tsunami disruptions. but there are concerns which could make consumers skittish about spending on a new car-- the election and worries about the fiscal cliff. >> some slowdown is certainly reasonable, but there is still a lot of pent-up demand because of how awful things got back in '09

when we only sold 10.4 million vehicles in this country. >> reporter: while industry watchers expect sales for the year to be about 14.5 million vehicles, the release of new mid-size models like this ford fusion could help prop up demand heading into the final stretch of 2012. ruben ramirez, nbr, new york. >> susie: so, what is the mindset of consumers going into this final stretch? joining us now to answer that, robert brusca, chief economist of his own firm, fact & opinion economics. >> the mind-set of consumers is it gasoline prices, problems in europe the job market. what's your opinion on that? >> i think it starts at home. first of all, the job market, the environment, a bunch of things very uneven, and gas price that is have been higher, and take the scarce income away from consumers, and the nagging concerns about other things, about the elections, and what happens

with tax policy and europe. and jobs and a little bit about gas. >> tell us a little bit about the elections. >> d do you think that people will feel better just knowing who's going to be in the white house, and then go ahead with financial decisions they were going to be making and buy whatever purchases they were thinking about. >> we hope it's going to work out like that. >> when they win, we don't know the congress they're going to work with. we don't know if it's something they can put their heads together and work with or the parties will be at logger heads. >> it will be organic. we have to see who is elected and the demeanor between the president and the congress he has to work with. >> susie: and you know we hear so much from the federal reserve about how much super low interest rats are going to help the economy. to what extent are the low rates motivating consumers to

spend? >> i frankly don't buy that too much. i think there's a problem because you hurt people's interest income, and people with interest income could spend more, and the problem is people aren't able to access the low rates. you need a very high credit score to get the low rates and everybody that can access the low rates has done it, and if the rates were higher banks wouldn't require as high of a credit score. they're selling what they can through fany and fedy freddie. it's about credit scores and not interest rates. >> susie: aside from what banks are doing. what has to change, to change consumer attitudes about spending? >> the economy has to get better. we've had this in the summer for the past two or three years in a row, and every economy rebounds. if we're going to have a rebound in the holiday season, that could be great and help

to put people back to work, and allow them to spend a little bit more freely. we also have a long holiday season. november starts out on a thursday, which means thanksgiving comes early as it can come, and the most space between thanksgiving and christmas to get the spending n. >> susie: a few more shopping days in there. thanks, bob. nice to talk to you. robert brusca, chief economist. >> tom: in europe, spain's >> tom: in europe, spain's prime minister dashed hopes the country will ask for a bailout soon. that request would help trigger the european central bank's latest bond-buying program, seen by investors as helpful for the markets. here in the u.s., the dow lost almost 33, the nasdaq gained 6.5, and not much change for the s&p; it's up about a point. >> reporter: i'm darren gersh. still ahead, both mitt romney and barack obama want to put more americans back to work. but is job training the right answer? we'll take a look.

>> tom: six months before the credit crunch hit full force, j.p. morgan bought failing investment bank bear stearns. that was in 2007. now, j.p. morgan faces a lawsuit, claiming it inherited massive fraud on the part of the company it purchased. the civil lawsuit alleges systemic fraud with the packaging and sale of mortgage- backed securities by bear stearns before it was taken over by j.p. morgan. the bank says it intends to fight the case. eric schneiderman is the attorney general of new york. >> eric, you represent the people of new york state. what did your citizens lose in the deals thaw are accused of being fraudulent? >> new yorkers, like people all over the united states bought shares in mortgage backed securities, pension funds invested in them. people bought homes baseed on what they thought was the

realistic value of the housing market. we've learned that the housing bubble, sxlt mortgage backed securities bubble were created, in part, by some pretty flamboyant types of misconduct n. this action which we filed yesterday against j.p. morgan chase really for the activities of bear sterns and companies they purchased later is one of the most flamboyant examples of fraud we've seen in this area. this involved a scheme from 2005 to 2007, and it's not a case as many have been, about one deal or 5 deals. it's the entire force of business. essentially the core promise they made to investment oshz was that they could buy the mortgage backed securities because they had rigorous systems in place to check on the quality of the loans. >> tom: you've called this

systemic fraud. what about the originators of the original mortgages. bear stearns was packing them in securities but others were giving out the original home loans? >> well, the originators as we now know were really in the cat bird seat, because bear and some other firms were so desperate to get mortgages of whatever quality to sell mortgage backed securities that they would ignore the defects and fail to hold lenlders accountable for anything. country wide and others -- >> tom: should we expect lawsuits against the originators? >> there have been some cases against them. there may be more. my focus, as far as securities fraud goes, really is on the banks that provided the warehouse lines of credit that encouraging and really provided the market for the

originators, because the banks -- and i haven't said that never representation by bear stearns was fraudulent, but their representation of due diligence. the representations that they were checking to make sure the loans were okay, and the lenders were following appropriate guidelines and a quality control system in place where they'd go check loans even after they were put into securities turned out to be a sham. they didn't have a system, it was dysfunctional, and that's what we're going after them for. >> tom: eric schneiderman, the prosecutor bringing the case, the attorney general of new york.

>> susie: american factories were humming this summer, but they could soon peter out. a survey of factory executives by the business consulting firm mcgladrey shows they are worried that their business could suffer because of over-regulation and the end bush-era tax cuts next year. and as diane eastabrook reports, that could mean fewer jobs in an industry that has been a bright spot in the u.s. economy. >> reporter: last year, bison gear and engineering was firing on all cylinders. sales of gears and motors to restaurant, packaging and health care equipment companies were up 20%. business was so good, the company added 17 full-time jobs to the more than 200 it already had. then this spring, something happened. >> the air just kind of went out of the soufflé on our sales to our original equipment manufacturers. >> reporter: what's happening at bison gear appears to be happening at other manufacturers, as well.

of the 900 firms recently surveyed by business consultant mcgladrey, 39% thought their businesses were thriving and growing versus 45% last year. there was also a slight up-tick in the percentage of companies who think business is declining. some of the increased pessimism is attributed to slow growth in europe and china. but mcgladrey's karen kurek says some of it is homegrown. she says about three quarters of the firms surveyed worry about the expiration of bush-era tax cuts. >> so when those tax rates go up, that's less money that the owner has to reinvest in the business, to hire more people, to reinvest in property and equipment and those types of things. >> reporter: the uncertainty at home and abroad is forcing bison gear to tighten its belt. the company has hit the pause button on hiring and is cutting about two dozen temporary positions. >> we're working on working smarter instead of harder. we do a lot of in-house training

that has resulted in productivity gains, so our planned productivity improvements will allow our people, you know, the full-time employees to pick up the slack. >> reporter: while the forecast for next year is still uncertain, many factories like bison gear remain optimistic about the future and their ability to compete in the global market place. diane eastabrook, nbr, st. charles, illinois. >> tom: index fund giant vanguard is changing the measuring sticks for 22 of its funds, impacting more than a

half-trillion dollars of investor money. the mutual fund firm says the changes will lead to shareholder savings. in january, 16 u.s. stock and balanced funds, including vanguard's largest index fund, the total stock market fund, will follow benchmarks developed by the university of chicago. six vanguard international stock funds will stop following benchmarks from msci and switch to indices operated by the ftse group based in london. >> susie: just in time for the holiday selling season, samsung can sell its galaxy tablet again in the u.s. a california federal court lifted the sales ban late yesterday. in june, a judge temporarily stopped galaxy sales as samsung and apple fought a patent case in court. in august a jury ruled the south korean company's tablet computer did not infringe on apple's patents. the galaxy 10.1 is an older model, but analysts say it still could deliver big sales for samsung over the holidays. now, what do apple, coca-cola, and ibm have in common? each earned the top three spots

on interbrand's annual best global brands list. coca-cola is holding steady at number one for the 12th year in a row. but apple, the maker of the popular iphones and ipads, is close on its heels, jumping to number two thanks to stellar global sales. while tech companies dominate half of the top ten positions on the list, blackberry finds itself at the bottom, plummeting to 93 as the company struggles to reinvent itself. >> down the table, and by no means a prediction of future movement. it's about products, people, culture, and about making sure that you have a brand and an offer that is relate toif the market. no reason to sigh that this is by any means the end of blackberry. >> susie: some other notable changes-- the british bank barclays was knocked off the list completely due to the recent libor scandal. meanwhile, facebook made its debut at number 69. >> tom: u.s. stock indices finished mixed today after early

gains slipped away. the s&p 500 hit its highest price of the session in the first five minutes of the day. the index fell into the red before the noon hour, and pulled itself back into positive territory in the final hour to end the session up a fraction. trading volume fell from yesterday's pace-- 594 million shares on the big board; 1.6 billion on the nasdaq. materials topped the stock sector losers, down six tenths of a percent. health care was the strongest sector, rising a half-percent. fertilizer maker mosaic was the spoiler among material stocks. despite strong demand for fertilizer, mosaic had trouble with a key ingredient, phosphate. that shortage hit earnings. results were 14 cents per share less than estimates, with the company earning $1.01 per share. low production at a phosphate mine in florida pinched mosaic's supplies during the quarter. production has since picked back up.

the stock price fell 3.9%, making it the biggest loser among material stocks in the s&p 500. volume was three times normal we dig deeper on the mosaic stock chart at nbrcom. you can find it under the blogs tab from michael kahn. in the health care sector, insurer wellpoint was in focus. shares rose 4.3%, rallying to their highest point since angela braly stepped down as c.e.o. the company announced a bond sale to raise money with $600 million going to stock buybacks. there was a lot of action in the telecommunications industry, with deutsche telekom talking about merging its t-mobile business with metro pcs. the talk pushed metro pcs shares up 17.8%. volume exploded-- more than five times normal. last year, t-mobile's buyout by at&t was canceled over anti- trust concerns. t-mobile could use the deal to

expand its wireless spectrum as it builds out its next generation wireless service. it's just the latest possible suitor for metro pcs and its no- contract pre-paid wireless service business model. it's a model similar to leap wireless and its cricket brand. leap shares jumped 8.4% as volume jumped five-fold. one of the companies that had reportedly looked at metro pcs in the past and said "no deal" is sprint. shares fell 5.4% on very heavy volume. analysts say a t-mobile metro pcs deal would present the biggest threat to sprint. while we're talking about the wireless business, it's worth noting research in motion shares are at their highest price since august. the company makes the blackberry device and has seen its business hurt by apple and google. but last week, it stuck with its pledge to introduce its newest device early next year. earlier, we reported on how mutual fund company vanguard will be changing benchmarks for 22 funds next year. the business loss for its

current provider, msci, is estimated at $24 million. but it led to more than a $1 billion loss in market value for the stock. shares plunged 26.8%, free falling to a new low. analysts note the vanguard business may be small financially, but the change could be a knock on msci's prestige. four of the five most actively traded exchange traded products made fractional gains. the s&p 500 volatility note was down. it tends to move in opposite direction of the broader market. and that's tonight's "market focus."

>> susie: more than 12 million people are looking for jobs in america, and almost half of them have been on the hunt for more than six months. so, to get everyone back to work, both presidential candidates are proposing ways to help the unemployed sharpen and upgrade their skills. but as darren gersh reports, their approaches are quite different. he kicks off our special coverage this week on job retraining. >> reporter: employers will tell you it's hard to find skilled workers. and both president obama and governor romney agree we need more effective programs to help people develop the skills to handle high-wage jobs. president obama is backing an $8 billion fund to help community colleges connect with businesses on workforce development. >> we've got to train our workers to fill good jobs. let's help give two million workers the chance to learn the skills they need at community colleges that will lead directly to a job. >> reporter: but government

auditors report most federal job-training programs have not done the expensive studies needed to determine whether or not they are effective. and those that have done impact studies find only small or short-term benefits from job training. >> which i think is remarkable that, after five decades, that the main federal auditor, the g.a.o., can't really find that these programs work really well at all. >> reporter: but governor romney still talks up job training. he backs personal reemployment accounts that workers can use to find training and job counseling. and he wants states to take the lead, not the federal government. there are now 47 different federal training programs, and romney calls that duplication a waste. >> all that money, all that overhead-- what i want to do is take those dollars and bundle it up, send it back to nevada and say, "you train your people for the jobs the people of nevada need and want." >> reporter: most of those 47 programs are very small and they're aimed at groups like veterans and the poor. governor romney would replace

them with a fixed grant of money to each state. that would give states more flexibility. but that funding would come with some risk. >> in the end, it often becomes an excuse just for cutting resources, and we've already cut resources so dramatically in this area. the cuts are as steep as 90% compared to 30 years ago when these programs peaked. >> reporter: when congress gets back to budget talks next year, there's a good chance job training will be cut even further. but there is bipartisan agreement that the money we do spend on job training should be used more effectively. darren gersh, nbr, washington. >> tom: tomorrow on nbr, we'll continue our look at job training with an on-the-job training program helping pay companies to train new workers. then, ahead of the first presidential debate, we'll break down what to watch and listen to on the economy from the two candidates. >> susie: when it comes to sports, the competition isn't

limited to the playing field. electronic arts is learning how you can lose and win with video game players. sports analyst rick horrow explains this week's "beyond the scoreboard." >> the games are very different but the goal is the same for electronic arts. and goals are where the sales are. e.a.'s "fifa soccer 13" video game was launched last week with unprecedented success. the game, in its opening day, sold 353,000 copies in north america, a 42% increase over last year's title. and interest in fifa isn't limited to north america. worldwide, more than 1.3 million copies were pre-ordered, and in the u.k. alone, one million copies were sold in the first week. unfortunately, what should have been a banner week for electronic arts was overshadowed by the announcement that its "nba live" game is staying on the bench for the second time in three years. the company hasn't released a basketball game since 2009, despite paying the nba tens of

millions of dollars annually for licensing rights. while e.a. sports hope to release the game next season, they continue to fall far behind the rival nba series from competitor 2k sports. it's shareholders who lose out. >> susie: that's "nightly business report" for tuesday, october 2. have a good evening, everyone, and you too, tom. >> tom: good night, susie. we'll see you online at nbr.com, and back here tomorrow night. captioning sponsored by wpbt captioning sponsored by wpbt captioned by media access group at wgbh access.wgbh.org

>> join us anytime at nbr.com. there, you'll find full episodes of the program, complete show transcripts and all the market stats. also follow us on our facebook page at bizrpt. and on twitter @bizrpt.